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Singapore shares close 0.4% higher on Thursday amid cautious sentiment

THE local market spent much of the trading day lower before reversing those losses, showing resilience at a time where equity markets are mostly facing headwinds, with the exception of US Federal Reserve rate cut hopes.

Thanks to the rally in the afternoon session, Singapore's Straits Times Index (STI) closed at 3,220.66, up 12.92 points or 0.4 per cent.

Global growth concerns continue to weigh on sentiment as do US-China trade issues. With the G-20 summit on June 28-29, market watchers had hoped until recently that the US and China would agree to a trade deal in Osaka. But both sides are not any closer to doing so, let alone having a timetable for a formal meeting.

US President Donald Trump also turned up the offensive on Germany for its lack of spending on defence and is considering slapping sanctions to block pipelines that would increase natural gas flow from Russia to Germany.

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Perhaps, adding to one of the bright spots on sentiment - rising Fed rate cut expectations - was US inflation clocking in below expectations on Wednesday.

"US inflation data printed below consensus, adding to the case for a Fed rate cut with the economy showing signs of slowing," ING Asia economist Prakash Sakpal said.

In Singapore, trading volume clocked in at 1.08 billion securities, 90 per cent of the daily average in the first five months of 2019. Total turnover came to S$1.02 billion, just under the January-to-May daily average.

Across the market, advancers outpaced decliners 214 to 154. The STI had six of its 30 components in the red.

Property and real estate investment trusts (Reits) remained in vogue, thanks to a dovish interest rate outlook. City Developments Limited advanced S$0.23 or 2.5 per cent to S$9.42 while CapitaLand added three Singapore cents or 0.9 per cent to end at S$3.43.

Among Reits, CapitaLand Commercial Trust units added three Singapore cents or 1.5 per cent at S$2.08.

On 37.7 million shares traded, Yangzijiang Shipbuilding was the benchmark index's most traded stock on Thursday. The shipbuilder gained two Singapore cents or 1.4 per cent to close at S$1.47.

Among the banks, DBS Group Holdings edged down two Singapore cents or 0.1 per cent to S$24.68 and OCBC Bank dropped three Singapore cents or 0.3 per cent at S$10.77. Meanwhile, United Overseas Bank ended at S$24.75, up S$0.14 or 0.6 per cent.